Time to start looking at buying beaten down stocks!!

Hey fellow traders,

What an ugly start to the fall season in the stock markets! I hope it was an enjoyable one for all of you who were shorting the heck out of the markets.  As I keep saying, learn how to short sell the markets b/c it is the easiest way to make money in these markets. As you may have seen recently, people are panicing and getting the heck out of stocks in general. Even the solid and strong fundamental companies are getting hit hard. The market doesnt care whether the stock is good or bad. The sentiment is so negative out there that people just get the heck out of their stocks due to fear of the stock going down more. In my opinion, when you see these types of situations, you should look to do some due diligence on some strong names and begin to look at buying these quality names at bargain basement prices. Obviously, you need to take a look at the charts but if you want to swing some positions, then you should look to tippy toe into some positions and look to slowly build your stock position. Maybe buy a few shares and if the stock goes up then buy more. I have started looking at the Agriculture and fertilizer sector to research some beaten down quality companies and the Energy sector as well. The Canadian banking sector also is starting to look attractive as well. The Toronto Stock Exchange has lost over 1,000 points this past week. This is the time period that you may want to start looking at buying rather than selling or shorting. Good luck trading.

Rotten Apples - Steve is not dead

Hi ATA crew,

you may have heard Bloomberg mistakenly published a Steve Jobs - AAPL CEO - obituary this week.

http://blog.wired.com/business/2008/08/steve-jobs-is-n.html

I guess they have these things pre-written so they can get it out quick when they happen. With the rumours, then denial that Job’s health was in question a month or 2 ago, and now this mistake from Bloomberg, poses the question: what do you think would happen to stock price if AAPL’s COE keeled over tomorrow? I have a feeling the market does perceive that AAPLs recent success and current vision is a direct result of its current COE. Would an event like this cause a bigger move than other comparable companies?

Anyway, enjoy the last weekend of the summer, and looking forward to more market volume coming this fall!

cheers, Vic

Oil Play - Aug 13 2008

Hey guys,

Just curious to know if anyone has any trading stories to share??

I shorted RIMM today just after the OIL report at $126.80 and hopped out less than a minute later after a quick half point. I pretty much counted my profits then turned my computer off and left to run errands. When I got back home, I noticed RIMM was moving like a roller coaster all day long.

Maybe I got up and left too soon?? Coulda, woulda, should of. I’m more than happy to have been in the money period! I’ve come to learn not to get busted up over the probabilities of extra profit. I’d rather ponder about how much money I could of given back instead - believe me nothing hurts more than leaving the market for the day on that boat. I’ve ridden it too many times and it can ruin the rest of the day like you wouldn’t believe. The mental torture of turning a profit and handing it back is not worth jumping back in a trade to make a few more bucks if your not sure which way the stock could move after momentum stalls.

Learn to be happy with a little sumthin’ rather than a whole lotta nothin!

Looking back at the blog, I noticed that Ramon had wrote that he played RIMM to the short side a few weeks back as well. Good to hear you took your profits and ran. Like yourself, I felt like continuing to trade after making a quick profit  but my habits are now changing - I got a lot of making up to do because of silly mistakes and money hungry eyes.

So how about the rest of us Active Traders?? I haven’t read anything on this blog from Maya Cotton in a while.

Where ya at girl?

Easy.

Europe trip commentary!!!

Hey fellow traders,

I am back from my European experience and now in Toronto. I will be here til the end of the month and then head back home to Vancouver. I hope all of you had an awesome summer and trading has been a tremendous success for all of you. The market has been volatile and just looking at the charts, it hasnt been a slow summer at all. Like last summer, it has been a down market and I hope all of you learned to profit from the downside. As I have been away from the markets for the past while, I dont have any market commentary for you. I actually only traded a few times while I was away. It seems that Europe is not very sophisticated in technology and I havent been able to have any reliable connection at some places that I was staying at. So what I thought I would do is share my traveling experiences with you and highlight some of the special things that I saw. Once you are consistent with trading, you can really trade from anywhere in the world and this is really the big benefit of trading. People who I meet in Europe are amazed that we can earn a living by having a laptop and internet access. So work hard in being consistent and go and explore the world.

So here goes. I started in London and you could see the contrast in the old and new part of the city. The museums there were amazing and went through the financial district as well. I visited a few brokerage firms there and something to keep in mind is if you’re a UK resident, there are some stock trading instruments where you dont get taxed on any capital gains. Sports betting is really popular there and no taxes on that as well. I would consider trading there but London is one of the most expensive cities to live in the world due to the pound being so strong. My next stop was Brussels, Belgium and I went to this bar/pub that had 1001 types of beer. Belgium beer as you know is the best and I tried as much as I could. Didnt feel too well the next day.. haha. Next was Amstersdam, Holland and they are only known for 2 things: Coffee Shops and the Red Light District. Enough said. Next was Lucerne in Switzerland and we went up to one of the biggest mountains in the Swiss Alps. It is very comparable if not bigger than Whistler. Switzerland is one of the most expensive places to live in the world. You can go to McDonalds and order a Big Mac meal and it will cost you over $15 Cdn. An ice frappacino in Starbucks will start at $7-8. Next was Munich, Germany and they are really known for their beer halls. This is where they served beer by the litre… i think I had 3 litres but lost count after the second one. Next was Venice, Italy and I took one of those canal rides through the city. Amazing views but the thing I didnt like was there were so many tourists there. It was quite overbearing. Florence in Italy was a bit better and went to the top of the mountain and saw an amazing view of the city. In Italy, the pizza and pasta was really amazing. I am not a fan of pizza but it was so delicious that I probably gained a few pounds there. Went to Pisa in Italy where they had the leaning tower. Next was Nice, France and this is truly one of the most beautiful places in the world. The water was clear blue and the beaches had topless women. We travelled along the French Riverera and this is one of the most glamorous places as this is where they hold the Cannes festival and celebrities hang out here. Monaco was really close by and I went to the famous casino there. In addition to Switzerland, you had to pay $15 cdn to enter the casino there. The amount of wealth there was truly amazing. Next was Barcelona and the parties there were crazy. I hung out in this party area where there were lots of clubs and bars literally side by side to each other. Next was Bordeaux, France which are famous for their wines. In fact, I was told that most of the wine out of France was made there. Next was Paris and of course, I had to walk up the Eiffel tower and see the Mona Lisa there. Paris was really nice and I can see why women want to flock to Paris and get married there. Next was back to St. Gallen, Switzerland, a very small town of 70k people and there I felt like I was living in the Stone ages and spent a few days living on top of a mountain. There, I lived right beside the cows and hiked up one of the big mountains. As well, this is where I opened up a Swiss bank account and from speaking to my friend who works there, the bank accounts have no names attached to them. If you want to hide money from your wife or husband then you should deposit your money here. Next was Prague and it is true that they have very beautiful women there. The party scene was unbelievable. This is where you needed to be very careful as the taxi drivers are notorious for overcharging you. Last stop was Budapest, Hungary and another party city. The good part in trading in Europe is the North American stock markets open at 3:30pm and closes at 10pm. So you could party all nite which I did until 5am and wake up late and then have lunch before you start work. I could get used to that type of lifestyle. Overall, I had a really good time and would encourage all of you to go travel and see the world. Bring your laptop and make money while you’re traveling.

I will start providing market commentary at the beginning of September. If anyone of you have any questions, please post them here. Enjoy the rest of your summer.

Mike

Positive results on negative news!

Fellow Traders,

Just want to share a trading experience…

With a lot of talk about about the US in “recession”… GM reporting a huge loss and keeping an eye on down trending Nasdaq COMP and Dow Jones this morning , I day traded a plan to Sell RIMM.

RIMM had a huge run up yesterday from $119  to$124.  It retreated and found support @ $122.30.  Today, I planned a trade to Short RIMM below $122.30 and exit at $119.  It went well!  Except, I didn’t fully stick with the plan.  I settled for a $1 profit, instead of $3.  So I tell myself…  “Nobody got poor by taking profits!”.

That’s it for the day!  Now, on to my chores and other day job!

Ramon.

ps.  I still want to trade!

Lazy Bloggers Syndrome - Wed, July 23, 2008

Fellow Traders,

WHERE IS EVERYONE?????

What’s the deal folks? Every time I come to this site it feels like I’m staring into a mirror….like I’m the only one around?

I’m sure the summer is keeping everyone busy,which is great but I’m having a hard time believing that no one has any trading stories to share.

I’m hoping that it’s shyness and not laziness,that’s keeping folks from posting their trade results online?

Whichever it is, I am now officially inviting each one of Mike’s students to join me in putting their trade plans together over any given weekend.

I am %100 positive putting trade plans together as a team would help each one of us become better traders and over all students of the Active Traders Academy.

You guys took the course to make money right??? Last time I checked everyone dropped $3000 for the course, right??? It would be a shame not availing the opportunity to network coast to coast with one another in order to minimize the learning curve.

So let’s exchange ideas and upcoming opportunities as much as possible. Lets talk. Lets laugh at the hard ships trading effortlessly showers on all new comers. Let’s quit pretending that were gonna become better traders all by ourselves — the blog’s creation was in order to fill these very needs of ours.

Talking to one another creates excitement and support — so why are we carrying on as though this country wide network of students doesn’t exist? It absolutely does!!

We have a fantastic platform to build on as new traders and here we are waiting for someone else to start mysteriously bringing this blog to life. Who are we kidding??

If your busy, kool!! Best of luck.

If your shy, no worries. ” Hi! My name is Nomi and I’m an Active Trader. I’ve been addicted to trading for 6 months now”.

My number is 778-865-9585.

My email is chabiwala@hotmail.com

Let’s make a plan to get to know one another and become stronger traders in the process.

I have many work related commitments but I’ll make time to discuss a trade plan at the drop of a hat.

If I’m not working then I’m busy lifting weights — regardless I have time.

I also have a wife, who’s romantic fantasy’s need constant fulfilling; be it hand feeding her chocolate almonds or rescuing her from some imaginary burning building. Either way, I’ll make time regardless because I love talking stocks.

Trading is a passion for me,not a chore so please don’t ever hesitate to “get at me” any time. 7 days out of the week. I would LOVE to hear from all of you.

Let’s make it happen sooner than later my friends.

Simply,

Your friendly neighborhood trader…. (cue retro Spiderman theme)

Happy trading.

Anybody Trading??? - July 16 2008

Hey guys,

What a choppy market we’ve been having over the last few days. I’ve been avoiding any trading at this point because of all the Fed meetings and they’re indecisive effect on the markets. The brokerage firm that I deal with is also cutting back on margin liquidity due to the current nature of things so trading for me is totally out of the question.

On the bright side, oil has been taking a nose dive and that seems to be holding the markets temporarily.

The message board has been pretty dry over the last few weeks so it would be refreshing to hear how the rest of you guys are playing this unpredictable market.

Hope everyones enjoying the summer weather.

Easy.

Nomi.

Question: Is the the bear market ‘technically’ here? - June 26 2008

Mike,

We broke major support on all three indexes today. We’ve lost all our gains on the Dow,S&P and Nasdaq in the last four weeks and according to statistics, the Dow hasn’t seen these levels since September of 2006.

Heavy downgrades in the financial sector tore a strip in today’s trading and record high oil put the nail in the coffin by the afternoon. Not even better than expected GDP and relatively inline jobless claims could help slowdown today’ s sell off.

So the question is, even though the market is completely oversold, are we technically headed lower because of major support being broken?

Question: Waiting for volume — June 24 2008

Mike,

Quick question:

Say I’m watching intraday movement and have set CLEAR support and resistance lines. I know I want to enter just below or above these levels but naturally I’m watching for volume to follow through before I pull the trigger. The problem is, especially when playing volatile stocks, is that as I’m looking for volume on the 1 min chart once support or resistance is cracked, I miss the entry price I want by a good 15-25 cents by the time I pull the trigger. This happens because I’m nervously racing over my keyboard to get in my order as the move is happening and my profit margin ends up getting cut into by the time I get filled.

The heartache of missing easy money making opportunities has pushed me to start experimenting with executing bracket orders before resistance or support is hit. This way if there IS volume behind the move then I get filled and my exit and stp loss are in place without wrecklessly scrambling over my keyboard after the breakout or breakdown occurs. Naturally,my results have varied. There are times where I get filled and volume tends to be light or even initially strong but then the stock reverses course and my stop get’s triggered. Ofcourse, there are also times when volume just shatters through my entry point, my order gets filled and I’m laughing all the way to the bank without touching a single button during the trade.

The key is to obviously limit getting into false breakout/breakdown traps. In your opinion, how risky is it to be executing a bracket order before volume is confirmed? Generally, isn’t everyone looking at the same resistance/support levels that I am? Wouldn’t that have most traders waiting to get in at those price levels? I’m not in favor of executing orders that may or may not follow through on volume before it’s confirmed — stop losses do pile up at the end of the day. At the same time I HATE punching in lightning speed orders as the move is confirmed because i get filled at a much higher price than I want.

I know you’ve suggested creeping into an order with half a position initially and then when volume is confirmed, jump in with the remaining half. The issue I have with this practical and cautious piece of advice is that if the trade goes in my direction, I know I will end up scrambling over the keyboard to get the second lot order in and this causes my nerves to go hay wire and I usually end up missing the move…as usual.

Maybe this issue is just a matter of slow keyboard skills and a lack of knowing how to use hot keys on the IB platform?

The way I see it, is that if I wait to confirm volume on a b/o or b/d and then get into the trade, it would be INCREDIBLY easier if all I had to do is hit one button instead of punching in the entire order after the fact.

What do you suggest I do? Moreover, what do you do? I know you execute trades with the IB platform as well so maybe you could possibly suggest ways that I could speed up the order process instead of putting in risky bracket orders before volume is confirmed.

Thanks.

Cheers.

This week - Lots of things happening

This coming week will be very busy and am guaranteed to be very volatile. Let’s start off with the economic calendar. These economic data will be sure to move the markets UP or DOWN.

Tuesday: Consumer Confidence

Wednesday: Durabel Goods Orders, New Home Sales, Oil Inventory #’s and most importantly, FOMC ANNOUNCEMENT

Thursday: GDP, Jobless claims, Existing Home Sales

Friday: Consumer Sentiment

For those who havent been through the FOMC anouncement days, this is guaranteed to be one of the msot volatile trading days especially if there is a surprise on interest rates being cut, raised or kept the same.

I am unsure what the consensus is for this time but from what I hear, the Fed is trying hard to fight or manage inflation and wouldnt be surprised to see no rate cut at all eventhough the US economy is slowing down.  If anyone has anything, please feel free to write your comments here.

Happy trading this week!!! I am sure it will be volatile for us Active Traders.